Digital marketing - 2009/2010

Another year is nearing a close and amidst the folly of many of us scrambling to get everything done before the festive season really kicks off, comments like, “where has this year gone?” and “What happened? I can't believe another year is over”, abound. It is at this time of year we start to think about what we will see happening with digital marketing over the coming year.

First, let's take a look at 2009, and what we believe were some of the bigger developments of the year:

1. Attitude shift

There has been a definite shift in the sentiments shared towards digital marketing. It is no longer seen as the poorer cousin of the advertising world and the interest for brands, products and services to be present in these spaces has peaked. This has resulted in traditional agencies taking notice and starting to think about how they can integrate with, and offer quality, meaningful service within this arena. South Africa has become a player in the global ranks in digital (MXit reports that it has 1.8mil international users) and further indications of this are developments like the Silicone Cape Initiative which recently announced its steering committee, voted in by the community of the Silicone Cape website.

2. Niche targeting

This year has seen an increase in the prevalence of location-based applications and location targeting such as The Grid and Foursquare and also of layering over maps of information, points of interest and even opinions. Google offers targeting to location by address and social media and consumer generated media has made collectives of “tribes” who are communities of shared interests. Through these means and the information gathered by asking the right kind of questions, consumers can be reached through super refined targeting.

3. Mobile

Mobile advertising has a lot of potential and power and there is plenty of debate about whether this will or won't work out. Most major publishers now have a mobile offering and South Africa is producing some top talent in this arena. An example like the award winning app Afridoctor, developed by 20fourlabs, which helps to make healthcare accessible to people in Africa, is a testament to this. Mobile is an area to keep a close eye on; the challenge however is finding the ways in which to make this work for brands and marketers. Another sign of investment in mobile advertising and its potential was the purchase of Admob by Google for $750M in 2009. Admob is a mobile advertising platform that has been especially popular with the iPhone. If Admob is the means to monetize mobile traffic then a purchase like this indicates that there is a heightened emphasis on mobile advertising and that it is surely set to go from strength to strength in the near future.

4. Site objectives

In the past, sites were judged by readers based on usefulness, content, or the amount of relevant data they had on hand or stored within their pages. These days a site is ranked as more relevant by the depth of consumer engagement that happens within those pages. Therefore sites have shifted their purpose and this has seen the importance of blogs and the fame of some of their writers (like Perez Hilton internationally and Seth Rotherham of 2Oceansvibe locally) go through the ceiling.

5. Disruptive vs social influencers

Brands have realised that it is essential that they take note of social influencers such as blog writers, and adapt a proactive approach to engaging in conversation with these people. This is the way they will thrive in the digital space going forward. With this however, comes a huge challenge for brand custodians, as they no longer have any control over the kinds of messaging or conversations that find their way around these social communities and the web. Recent example of this is the spoof Windhoek-Ras-Dumisani homemade viral ad that flew from inbox to inbox quicker than a bushfire in the Australian outback. When entering “Windhoek Ras Dumisani” in Google, the entire first results page relates to the spoof, in which Brandhouse had absolutely no involvement. The only thing brand owners can control is to be sure that they are delivering on what the brand promises and engage in meaningful conversations with consumers of their product, brand or service. Over delivering on a brand promise has seen the rise of self proclaimed brand lovers who will punt you for free if you make (and keep) them happy. It has become clear this year that people are more willing to spend money than waste their time and when great service saves time, people react. This is the new marketing - it is no longer about disruption and interruption.

6. SA digital ad spend increase

Even though we have been traversing through some of the most challenging economic times in recent history and the word “recession” has almost become a brand in itself, digital ad spend has seen an increase year on year. Other mediums have had budgets slashed and this has largely been the result of tighter budgets requiring more accountability. Digital marketing offers measurability beyond what any other medium can deliver and the decision makers behind the budgets have realised this as they are harder pressed to prove return on investment.

7. Online unique user base increases, page impressions not growing as fast

This presents new challenges to strategists and media planners. As web audiences become savvier, the pages to which they navigate are reached with more aggressive intent. This results in the growth of page impressions, and thus advertising inventory, not growing at the rate that readership is growing. These inventory challenges make online inventory a premium, and thus the need for more refined targeting becomes fundamental.

Peering into the 2010 crystal ball...

1. Growth of digital ad spend

Due to the lower cost of entry, together with all the possible measurement, particularly return on investment, digital marketing will become increasingly attractive over the next year. Next year will see interruptive communication being more and more replaced with persuasion and engagement; a trend that is already happening as mentioned during 2009 and will continue into the next year.

2. Mobile will grow

Mobile as a medium has been one of the hot topics over the past year. Many predicted it becoming a major channel. It has done much globally (especially in developing nations); in terms of mobile money transfers and now more recently with the commercialised roll-out of payment options such as MoWaly and wiWallet. As an extension to an integrated campaign however, marketers still need to get their head around how to use this medium effectively. We feel that 2010 will be the year we see many brands and campaigns getting it right. A phone is no longer just a phone, this is truly exciting and brands need to understand how and what they can communicate on mobile devices that is both effective and non intrusive.

3. Social media and social networks will continue to be on the forefront of growth

“Social media” has certainly been one of the buzz words of 2009 and we don't see this fact changing in 2010. What we anticipate is that it will become even more ubiquitous and the amount of time, interaction and people seen in these spaces will increase steadily; as too will the importance of consumer generated media as an element of life in 2010. So much so that more communication that used to happen via telephones and email will now take place through social media platforms like Twitter and Facebook where the bonus is that it's completely permission based and you don't need an address book or telephone numbers to reach people. With this trend of an increasing digital presence in an increasing number of places, the “one-sign-in-fits-all” will become prolific and more rapidly adopted over the coming year - hopefully alleviating the frustration of yet another new website registration.

4. Digital advertising

Advertising inventory in digital environments will continue to become an absolute premium as the number of unique browsers continues to climb but the available inventory hits a ceiling. This will pose further challenges to digital media strategists and planners as they have to truly refine their strategies in order to find the web savvy consumer they want to connect with and meet campaign objectives. This will see marketers and strategists pushed for smarter and more creative ideas. We still need to be mindful of the fact that budgets are still going to be cut and will remain tight. On the positive side though is that this will further encourage creative thinking.

5. Media measurement

As more companies, people, advertisers, marketers and communicators adopt and use social media and interact with consumer generated media it is going to become increasingly important in 2010 to measure the impact these mediums have on business, brands and services that are actively involved in these spaces. New metrics will need to be set up to measure the awareness and engagement factor these mediums deliver, along with identifying the measurables versus the business objectives.

6. Broadband culture

As broadband prices continue to drop and monthly bandwidth caps continue to expand in size, the culture of “true broadband” will slowly start to begin its journey into South African homes and business' and ultimately change the way we experience being “connected” in ways we, as South Africans, can hardly yet imagine. This will also mean that we will see richer ad and web site content becoming standard placement.

7. 2010 FIFA World Cup

The 2010 FIFA World Cup will be the biggest event of its kind that has ever taken place in South Africa and the build up to the event and the event itself will dominate through two thirds of next year. Anticipate a massive chase to buy up available digital inventory from now until August, after the World Cup. This event will also be the catalyst for some of the most creative, interactive advertising campaigns and viral stunts yet seen in our country. We will see digital being used as an extension to traditional mediums during the campaigns that will roll out over this period.

8. Cloud computing

Cloud computing is a general term for anything that involves delivering hosted services over the Internet. We believe that this will become more attractive and adoption of this new way of doing business will increase next year due to the attractive benefits it offers in terms of lowered costs, overheads and a reduced need for location based management structures. As with all new technology and shifts in thinking, this will take time and some getting used to. Just like Google Wave - at first you sit and you stare and you wonder how this is going to benefit your experience and then you have your first interactive document review and you are blown away. Or Twitter, when you first begin you have to follow random people to join conversations and eventually you find that you have no idea how you lived without it. Or even the mobile phone. We see the same sentiment being applicable to cloud computing in a few years from now.

9. The role of the digital agency

On a final note, we believe that 2010 will see the next generation approach to the role and relationship of the digital agency with regards to brands, products and services. In our vision this relationship is considered to be one of the most important and fundamentally essential partnerships a clients' business will have. We see this coming to fruition over the next year.

Overall, 2010 looks set to be an incredible year for the digital industry and let's not forget that for South Africa too as we welcome the world for the 2010 FIFA World Cup.